Which of the Following Occurs When an Organization Sells Part

question 1

Multiple Choice

Which of the following occurs when an organization sells part of a business or operation to another corporation?

• A) Merger
• B) Acquisition
• C) Divestiture
• D) Buy out
• E) Spin off

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Definitions:

Work in Process

Goods that are in the production process but have not yet been completed.

Finished Goods

Items that have finished being manufactured and are available for purchase.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including the cost of the materials and labor used in their production.

Job-Order Costing System

An accounting method that assigns costs to specific production batches or jobs and is used in situations where each job is distinct and not mass-produced.